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17Aug 2015

Canadian Private Market Recap: August 16

Posted By: Andrea Banerjee

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Last week Quebec-based Manac Inc agreed to become a private company, with an acquisition led by the caisse de depot et placement due Quebec. GrafTech International will also stop trading public shares after this week’s acquisition by Brookfield Asset Management. In financing news, Toronto’s Intelex Technologies completed a successful funding round, securing $160 million. Here are the major deals this week:

M & A

Manac Inc Will No Longer Trade Common Shares With Take-Private Acquisition led by caisse de depot

Manac Inc (TSX: MA) has been purchased by a group of investors comprised of Marcel Dutil (company founder), the caisse de depot et placement due Quebec, Fonds de solidarite FTQ, Investiseement Quebec, and Fonds Manufacturier Quebecois. Based in Saint Georges, Quebec, Manac is a leading manufacturer of specialty trailers in North America, and Canada’s largest trailer manufacturer. It produces vans, flatbeds, low beds, chassis and other equipment sold under a multitude of recognized brands. The deal values Manac at $186 million, inclusive of debt, and will be put before shareholders in October.

Stackpole Is Acquired by Hong Kong’s Johnson Electric Holdings

Stackpole International, a Canadian automotive parts manufacturer, has been acquired by Hong Kong’s Johnson Electric Holdings. The total consideration for the deal is $800 million in cash payable by Johnson Electric. Stackpole manufacturers engine and transmission pumps and powder metal components, and was purchased by Crestview Partners and CITIC Capital in October 2013. With the deal’s closing, U.S. private equity firm Crestview, which has an 80 percent stake in the business, is expected to see roughly twice its investment returned. Peter Ballantyne, CEO and President of Stackpole said, “With Johnson Electric’s electric motor capabilities complementing Stackpole’s strengths in transmission and engine oil pumps, vacuum pumps and powder metal products, we look forward to building on the momentum we have gained with Crestview to further establish our position as a leader and innovator of automotive powertrain components.” The acquisition is expected to close in the fourth quarter.

Serruya Private Equity Buys Sani-Service

It was announced that the Toronto-based firm Serruya Private Equity has purchased Sani-Service for an undisclosed amount. Sani-Service, a provider of commercial hygiene and chemical services, is based in Markham, Ontario and has operations in Ontario, British Columbia and Alberta. “We are excited about this opportunity to foster the growth of a great Canadian service company,” said Michael Serruya, Managing Director of Serruya Private Equity. “We see many opportunities to grow both organically and by leveraging Sani-Service as a platform to make additional acquisitions.”

Last week it was announced that private equity group Brookfield Asset Management completed a preferred equity investment in GrafTech International for $150 million. Brookfield bought additional shares of the company’s common stock shortly after, giving it a cumulative controlling interest of over 86 percent. The entire transaction is valued at $840 million. GrafTech is based in Independence, Ohio. It is a leading producer of graphite material products for the manufacturing industry. Once the deal is complete, GrafTech’s public shares will be removed from the New York Stock Exchange.

Aqua Terra Water Management Buys Advance Hydrocarbon

Aqua Terra Water Management, L.P. has announced its purchase of Advance Hydrocarbon Corporation. Aqua Terra Water is a portfolio company of the U.S. private equity firm Bregal Partners. Advance Hydrocarbon Corp is a saltwater disposal and water-hauling operator based in Texas. ATB Financial provided financing for the deal. No financial terms of the transaction were disclosed. “Advance has a long history of delivering industry leading service to the largest producers in the College Station region,” said Mark Harris, CEO of Aqua Terra. “Together with Advance’s experienced management team, we look forward to continuing to provide this same level of service and adding capacity within the system.”

GMD Distribution Acquires Adjuvantz

GMD Distribution Inc, an arm of pharmaceutical distributor GMD PharmaSolutions, has purchased Toronto-headquartered Adjuvantz Inc. GMD is based in Oakville, Ontario, and manages the distribution of biological and medical devices as well as pharmaceuticals across Canada. Its two divisions were recapitalized earlier this year by private equity firm Hammond Kennedy Whitney & Co. “We are quite excited about the business combination of Adjuvantz and GMD,” John Leombruno, CEO of GMD said. “Adjuvantz, with its long industry tenure and impressive customer base, will be a tremendous addition to GMD.”

Serta Simmons Acquires Canwest Bedding

SSH Bedding Canada Co, subsidiary of Serta Simmons Bedding, has closed its acquisition of Canwest Bedding. The financial details of the transaction were not disclosed. Canwest is an independent Serta licensee located in Winnipeg, Manitoba. Canwest will continue to operate out of Winnipeg and will service Manitoba, Saskatchewan and Ontario. With this transaction, SSH is now in control of the distribution of all Serta and Simmons products in Canada. “We are excited to bring on board the Canwest operations and team,” said SSB President Michael Traub. “Not only have we expanded our ownership of the Serta brand in Canada, the acquisition demonstrates our commitment to advancing a key strategic goal for SSB, and that is to become a leading international operator.”

Financing

Intelex Technologies Secures $160 Million in Funding

Intelex Technologies Inc has completed a successful funding round, securing CAD $160 million in proceeds that will be used to support continuous growth. Intelex is based in Toronto, Ontario, and provides business performance and risk management software solutions to over 1,000 clients. The funding round was led by JMI Equity, a firm focused on software and service companies. HarbourVest Partners also participated in the financing. “This investment will help us accelerate some of our current initiatives and ensure we continue on our growth path,” said Mark Jaine, Presient and CEO of Intelex. “We are exceptionally proud to have partnered with JMI and HarbourVest in this effort and have the right team in place to further establish our market leading position.”

Connor, Clark & Lun GVest Traditional Infrastructure LP has made an equity investment in the $1.88 billion Regina Bypass Project. The initiative is part of Regina Bypass Partners, a joint venture between investors that include Graham Group Ltd, VINCI Construction SAS and Parsons Corp. The project is intended to design, build, operate and maintain a four-lane highway in the vicinity of Regina, and is the biggest initiative of its kind in the province of Saskatchewan’s history. Construction is projected for completion in 2019. “We are delighted that our consortium was selected to deliver this important project to the Province of Saskatchewan”, said Matt O’Brien, President of Connor, Clark & Lunn Infrastructure. “The project is our first transportation infrastructure investment and adds another high-quality asset to our large and growing portfolio.”